Greece to Sell 10% Stake in National Bank as Part of Banking Sector Privatization

Bloomberg reports that the Greek government is proceeding with the sale of 10% of the National Bank of Greece (NBG) in a move to privatize the banking sector further.

According to the Hellenic Financial Stability Fund (HFSF) the price range for the deal has been set between 7.30 and 7.95 euros, with the upper end of the price range being higher than Friday’s closing price of 7.84 euros. This means that Greece could raise up to 727.2 million euros from the sale.

Meanwhile, according to Reuters, the book for the placement in the National Bank, which opened on Monday, was oversubscribed within the first few minutes of the process, even exceeding more than once. Market information suggests that the placement may be covered four or even five times over.

The bookbuilding process is set to close on Wednesday, Oct. 2, marking the finalization of a series of state sales aimed at the Greek government fully exiting its stakes in Eurobank, Alpha Bank, and Piraeus Bank.

Last year, the HFSF sold a 22% stake in the National Bank of Greece, with it raising 1.06 billion euros, however, it is expected to retain an 8.4% stake in the bank.

Furthermore, Bloomberg notes that the Greek economy is performing far better than its European counterparts regarding bond performance, with the country regaining its investment-grade rating, lost in 2010 at the beginning of the debt crisis that devastated Greece’s economy.

The crisis left the credit institutions in the country with a large volume of non-performing loans, however, the ratio of bad loans is now approaching the European average.

As a further sign of a gradual return to normalcy, Greek banks were also allowed to pay dividends for the first time, this year, since 2008.

Source: tovima.com